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HP VRIO / VRIN Analysis | Assignment Help
What is VRIO / VRIN Analysis ?
VRIO stands for – Value of the resource, Rareness of the resource, Imitation Risk, and Organizational Competence.
VRIO is a resource focused strategic analysis tool.
To build a sustainable competitive advantage the resources that –casename— needs to be valuable, rare, and difficult to imitate. Secondly the –casename— needs to possess capabilities, organizational structure, and culture to optimize the available resources usage. VRIO analysis can help organizations such as HP to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for HP? Defining Valuable in VRIO
A resource or capability is considered valuable for HP , if it allows the
HP to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow HP to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for HP.
What are Rare Resources for HP? Defining Rare in VRIO
In an industry that HP operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. HP require rare resources to compete in the industry. If HP don’t have rare resources that are required to succeed in the industry then HP won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide HP competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for HP? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to HP for certain period of time as all the competitors are going to try to imitate or replicate that resource. A sustained competitive advantage emerges, if the resource is difficult to imitate by the competitors. HP can create inmitability by innovating on the product side, reducing pain points on service delivery, and having an effective post sales servicing strategy.
Check out the SWOT analysis of HP
What is a Organization for HP? Defining Organization in VRIO
Even if the HP has all the valuable resources that are both rare and difficult to imitate, it won’t automatically result into a sustainable competitive advantage. The key to build the sustainable competitive advantage is to have organizational capabilities, expertise, and structure to exploit the resources. If HP is not organized based on its strengths then it won’t able to exploit all the resources that it possesses.
Resources | Value | Rare | Imitation | Organization | Competitive Advantage |
---|---|---|---|---|---|
Marketing Expertise within HP | Yes, firms are competing based on differentiation in the industry | No, as most of the competitors also have good marketing departments and expertise | Pricing strategies of HP are often matched by competitors | Yes, HP is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Global and Local Presence of HP | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of HP but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps HP in delivering lower costs | No | Can be imitated by competitors of HP but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Opportunities in the Adjacent Industries that HP can exploit & New Resources Required to Enter those Industries | Can be valuable as they will create new revenue streams | No | Can be imitated by competitors | All the capabilities of the organization are not fully utilized yet | Has potential |
Pricing Strategies of HP | Yes, HP has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide HP with a Temporary Competitive Advantage |
Ability to Attract Talent in Various Local & Global Markets | Yes, HP strategy is built on successful innovation and localization of products | Yes, as talent is critical to firm's growth | Difficult to imitate for the current competitors of HP | To a large extent yes | Providing Strong Competitive Advantage |
Access to Cheap Capital for HP | Yes, as a leading player in the industry and current macro economic conditions, HP has access to cheap capital | No | Can be imitated by the competitors of HP | Not been totally exploited | Not significant in creating competitive advantage |
Successful Implementation of Digital Strategy at HP | Yes, without a comprehensive digital strategy it is extremely difficult to compete | No, as most of the firms are investing into digitalizing operations | Can be imitated by competitors | One of the leading player in the industry | Digital strategy has become critical in the industry but it can't provide sustainable competitive advantage to |
Brand Positioning of HP in Comparison to the Competitors | Yes | No | Can be imitated by competitors but it will require big marketing budget | Yes, the firm has positioned its brands based on consumer behavior | Temporary Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of HP | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Supply Chain Network Flexibility of HP | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by HP organizational structure and capabilities | Keeps the business running |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Brand awareness of HP products and services | Yes, the brand awareness of HP products are high | Yes, HP has one of the leading brand in the industry | No | HP has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Customer Community of HP | Yes, as customers are co-creating products | Yes, the HP has able to build a special relationship with its customers | It is very difficult for HP competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on HP customers community ecosystem | Providing Strong Competitive Advantage |
HP SWOT Analysis, SWOT Matrix, Weighted SWOT Case Study Solution & Analysis
Books and References
Ahir Gopaldas and Anton Siebert (2022 July August) "What You’re Getting Wrong About Customer Journeys",
Harvard Business Review , 92
Linda A. Hill, Emily Tedards, and Taran Swan (2021) "Drive Innovation with Better Decision-Making", Harvard Business Review 86
Dyer, J. H., & Hatch, N. (2004). Using Supplier Networks to Learn Faster. Sloan Management Review, 45(3), 57–63
Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120
Dyer, J. H., Kale, P., & Singh, H. (2004, July–August). When to ally and when to acquire. Harvard Business Review, 109–115
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